BEHAVIOURAL BUREAUBY NUDØ (BEHAVIOURAL DESIGNERS)

In the 60’s and especially during the cold war period, “deterrence theory” emerged as a concept very familiar to both sides of the conflict. Thomas Schelling assured “modern” military strategy was not only about the art of combat strategy and successfully introduced the art of coercion, intimidation and deterrence as part of modern military strategy.Deterrence theory states that the probability of behaving in a certain way can be modified depending on the probability of being caught and punished. In other words, applying a penalty, leaving everything else unchanged, will reduce the occurrence of the behavior subject to the fine. In the context of the Cold war, it was the threat of nuclear war and destruction that dissuaded the two super-powers, USA and USSR, from starting what seemed to be an imminent battle, especially during the crisis of Berlin in 61’ and Cuba in 62’.Now, what connection does deterrence theory have with the behavior at child day cares?

Gneezy and Rustichini (2000) decided to research the effects of a fine over the number parent delays at daycares in Haifa (Israel). For this, ten “daycares” with the same characteristics were selected and randomly divided into two groups, one that served as the control group (4 daycares) and another as the experimental group (6 daycares). The study consisted of the following 3 phases:

1)Observation – During 4 weeks, the number of delays was observed without applying any kind of fine or penalty.2)Fine application – From week 5 onwards the parents were notified that a fine of 10 Shequels (2 USD) was going to be applied for every delay of 10 or more minutes.3)Fine removal – In week 17, the fine was removed, and the behavior was observed during the next 4 weeks.Considering deterrence theory, previous psychology studies about punishment and behavior, and the fact that the parents’ delays are 100% identifiable and easily punished. It would be “natural” to expect a decrease in delays once a fine or punishment is applied, and that the number of delays would rise again once the fine´s removed. Nevertheless, the study showed very different results:

The vertical column shows the number of parent delays; the blue line represents the experimental group, while the red one the control group; the orange lines in week 5 and week 17 represent the 3 phases of the study.Contrary to what was expected, and facing a 100% verifiable and applicable fine, the parents almost doubled their number of delays once the fine was applied. This means parents knowingly broke the implicit contract that exists between them and the child daycare of providing service from 8 a.m. to 4 p.m only. But… why did this happen?

Counterintuitively the fine imposed became a price!. This means parents stopped perceiving the fine as a punishment and started looking at it as the price they had to pay for an “extra” service to which they were entitled after payment. There are two key factors in this change of perspective: a) the fine was relatively low (0.1% of the monthly fee) and b) the certainty that it was going to be applied was 100%. These factors generated a context in which the “kind” action from daycare employees of extending their work schedule suddenly became a “duty” from the parents point of view. That is, the fine passed from being a punishment to a price that socially justified the delays, since they were paying a price that the daycare considered “fair” for the “extra” care time.This is a clear example of how fees and punishments may result counter-productive if they aren´t properly planned and studied. Sometimes, behavior under certain circumstances depends on the certainty or uncertainty of the consequence, like the fine at the child daycare or crossing on a red light (maybe you will get a fine or maybe not). When there is a clear consequence, the behavior and perception towards it can change, occasionally turning it into something “normal” that people are willing to pay for. The fact that a punishment actually results in an unexpected behavior may well signal the need of an “extra” care service with a real “extra” cost.